The "Tokai Maru"

• Jurisdiction: Singapore
• Judgment Date: 23 June 1998
• Date: 23 June 1998
• Docket Number: Civil Appeal Nos 172 and 173 of 1997
• Court: Court of Appeal (Singapore)

The “Tokai Maru”

[1998] SGCA 78

Yong Pung How CJ

,

Goh Joon Seng J

and

Tan Lee Meng J

Civil Appeal Nos 172 and 173 of 1997

Court of Appeal

Civil Procedure–Extension of time–Striking out–Application by charterer for extension of time to file affidavit coupled with application by owner to strike out charterers' defence–Principles governing exercise of judicial discretion in deciding whether to allow applications–Civil Procedure–Delay–Extension of time–Application by charterer for extension of time to file affidavit dismissed–Whether delay of nine months justified–Whether owner suffered prejudice due to charterer's delay–Whether charterer's application to extend time amounted to abuse of process–Whether dismissal of charterer's application warranted–Civil Procedure–Striking out–Application by owner to strike out charterer's defence allowed–Whether defence obviously unsustainable on its face–Whether charterer had reasonable defence on face of pleadings before court–Whether charterer's defence should have been struck out–Order 18 r 19 Rules of Court (Cap 322, R 5, 1997 Rev Ed)

The respondents (“the owners”) were the owners of a vessel, the “Tokai Maru”. The first appellants (“the main charterers”) chartered the vessel from the owners and sub-chartered it to the plaintiffs (“the sub-charterers”) who placed their goods on board the vessel. During the sub-charter, the owners withdrew the vessel from the main charterers, made off with the sub-charterers' goods and sold part of the goods.

The sub-charterers sued the owners for conversion of their goods. The owners alleged in their defence that the main charterers had instructed them with regard to the sale. The owners commenced third party proceedings against the main charterers. An order of court was made on a third party summons requiring the main charterers, inter alia, to file and exchange the affidavits of evidence-in-chief of their witnesses within four months. The main charterers delayed filing their affidavit by nine months and applied for a retrospective extension of time. Meanwhile, the owners applied to strike out the main charterers' defence. The trial judge disallowed the main charterers' application for an extension of time on the ground that the delay was not justified. He also ordered their defence be struck out on the ground that their pleadings disclosed no reasonable defence. The main charterers appealed against both decisions.

Held, allowing the appeals:

(1) On the issue whether an extension of time should have been granted, the trial judge's adoption of the approach in Ratnam v Cumarasamy [1965] 1 WLR 8 was rejected as the instant case concerned an application to file an affidavit out of time, and not an application to appeal out of time: at [19] and [20].

(2) Both the main charterers' application and the owners' application were inextricably linked in that the main charterers' defence would naturally be struck out if the application to extend time was refused. Both applications should therefore be considered together in determining what justice required, and the case was best viewed in the round: at [23].

(3) The rules of civil procedure guided the courts and litigants towards the just resolution of the case and should be adhered to. Nonetheless, a litigant should not be deprived of his opportunity to dispute the plaintiff's claims and had a determination of issues on the merits as a punishment for a breach of these rules unless the other party had been made to suffer prejudice which could not be compensated for by an appropriate order as to costs: at [23].

(4) Save in special cases or exceptional circumstances, it could rarely be appropriate then, on an overall assessment of what justice required, to deny a defendant an extension of time where such denial would have the effect of depriving him of his defence This was especially so when it was due to a procedural default, even if unjustified, which caused the plaintiff no prejudice, for which he could not be compensated by an award of costs: at [23].

(5) As to whether the delay of nine months was justified, a mere assertion that the person in charge of the action forgot about the matter or neglected it or was too busy to get on with it was not an acceptable explanation for the delay. The main charterers' explanations were unsatisfactory and the delay was unjustified: at [29].

(6) The court did not characterise the delay as an abuse of process. The order with which the main charterers failed to comply was of a non-peremptory nature. The outcome might have been different if the order have been an “unless order”. The delay caused no prejudice to the owners. Nor were the circumstances so exceptional as to warrant dismissing the application for an extension of time: at [33], [38] and [39].

(7) A reasonable defence meant one which had some chance of success, when only the allegations in the pleadings were considered. The hearing of the application should not therefore involve a minute examination of the documents or the facts of the case in order to see whether there was a reasonable defence. To do that was to usurp the position of the trial judge and the result was a trial in chambers, on affidavits only, with discovery and without oral evidence tested by cross-examination in the ordinary way. The mere fact that the defence was weak and not likely to succeed was no ground for striking it out, so long as the pleadings raised some questions to be decided by the court. In short, the defence had to be obviously unsustainable on its face to justify an application to strike out. In this case, the main charterers had a reasonable defence on the face of the pleadings. The mainstay of the defence was a simple denial that they were the bailees of the sub-charterers' goods, that they had misrepresented to the owners that they were the owners of the marine gas oil, that they had not authorised the sale of the oil, and that they did not owe any money to the owners. These assertions, if proven at the trial, would afford a full defence: at [44] and [45].

Attorney-General of The Duchy of Lancaster v London and North Western Railway Company [1892] 3 Ch 274 (folld)

Active Timber Agencies Pte Ltd v Allen & Gledhill [1995] 3 SLR (R) 334; [1996] 1 SLR 478 (folld)

Atwood v Chichester (1878) 3 QBD 722 (refd)

Choraria v Sethia142 SJLB 53 (distd)

Costellow v Somerset County Council [1993] 1 WLR 256; [1993] 1 All ER 952 (folld)

Cropper v Smith (1884) 26 Ch D 700 (refd)

Drummond-Jackson v British Medical Association [1970] 1 WLR 688; [1970] 1 All ER 1094 (folld)

Grovit v Doctor [1997] 1 WLR 640; [1997] 2 All ER 417 (refd)

Miles v McGregor (23 January 1998, CA) (folld)

Price v Dannimac Ltd (The Independent, 3 August 1990, CA) (folld)

Shtun v Zalejska [1996] 1 WLR 1270 (folld)

Smith v Secretary of State for the Environment (The Times, 6 July 1987, CA) (distd)

Tan Chai Heng v Yeo Seng Choon [1979-1980] SLR (R) 658; [1980-1981] SLR 381 (distd)

Thamboo Ratnam v Thamboo Cumarasamy and Cumarasamy Ariamany d/o Kumarasa [1965] 1 WLR 8 (distd)

Visha Apurva, The [1992] 1 SLR (R) 912; [1992] 2 SLR 175 (folld)

Wenlock v Moloney [1965] 1 WLR 1238; [1965] 2 All ER 871 (folld)

Rules of Court (Cap 322,R 5, 1997 Rev Ed)O 18r 19 (consd)

Belinda Ang SC and Hung Ning Shing (Ang & Partners) for the appellants

Vinod Kumar Dube (Dube & Co) for the respondents.

Tan Lee Meng J

(delivering the grounds of judgment of the court):

1 There are two appeals before us. In the first, CA 172/1997, the appellants appealed against the learned judge's decision to disallow their application for an extension of time to file their affidavit of evidence-in-chief. In the second, CA 173/1997, the appellants appealed against the learned judge's order that their defence be struck out. We allowed both appeals and now set out our reasons.

Background

2 The respondents were the owners of a vessel, the Tokai Maru. The first appellants chartered the vessel from the respondents and sub-chartered it to the plaintiffs, who placed on board the vessel their equipment, provisions and marine gas oil (“the plaintiffs' goods”). During the duration of the sub-charter, the respondents withdrew the vessel from the first appellants.

3 Following the withdrawal of the vessel, the vessel made off with the plaintiffs' goods and the respondents sold part of the marine gas oil. The plaintiffs commenced an action against the respondents for conversion of their goods (“the main action”). The respondents resisted the plaintiffs' claim and alleged in their defence that the first appellants had instructed them to sell the plaintiffs' marine gas oil and that the proceeds of the sale had been credited to the account of the second appellants. The respondents then commenced third party proceedings against the appellants. An order of court was made on a third party summons on 11 June 1996 requiring the respondents to file the statement of claim within 14 days and the appellants to file their defence within 14 days thereafter. The same order directed the parties to file and exchange the affidavits of evidence-in-chief of their witnesses within four months, that is, by 11 October 1996.

4 The appellants intended to call two witnesses, Tay Siong Siew and Yap Hong Luan. The appellants claimed that both witnesses were often out of the country and they had therefore been unable to take full instructions from them in time to file the affidavits within the four-month period. On 11 October 1996, the appellants' solicitors wrote to the respondents' solicitors asking for an extension of time to file the affidavits. The respondents' solicitors did not reply to this letter.

5 Tay Siong Siew and Yap Hong Luan prepared their affidavits of evidence-in-chief on 3 May 1997 and 19 April 1997 respectively as witnesses for the plaintiffs in the main action. The appellants then decided that Yap would not be required to give...